CHICAGO, Illinois—Business might be slow for hotel designers now, but Roger Hill is optimistic there will be plenty of work to go around sooner than later.
During a recent interview in Chicago, Hill said the current state of the hotel industry will create opportunity by default as fundamentals improve.
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Gettys president and COO Andrew Fay (left) and Roger Hill
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“As soon as we start the next wave of transactions, there will be a group of aggressive buyers that will be looking to upgrade or reposition the assets they buy,” said Hill, CEO of Chicago-based Gettys Group, a design and fulfillment firm founded in 1988. “We’ll ride that wave for 24 months. If you don’t believe the world is coming to an end, then the next few years should provide you with a lot of opportunity.”
Hotel owners with long-term vision recognize it’s much better to renovate when a hotel is suffering through 60-percent occupancy rather than when it’s at 75 percent or 80 percent occupancy because there are fewer disruptions for guests and staff, Hill said.
Another angle to consider is the costs of materials and labor. For example, a project in Southern California now costs 10 percent to 15 percent less than what it cost a year ago Hill said.
“It’s definitely not business as usual,” he said. “But as things begin to improve, there are going to be terrific opportunities.”
Gettys Group recently opened the Hotel Felix in Chicago—the first hotel in downtown Chicago to be LEED silver-certified, which is the third highest level on the U.S. Green Building Council’s Leadership in Energy and Environmental Design program.
Sustainable related features of the hotel include:
- in-room motion sensors that control heat and lighting;
- the use of recycled products in everything from artwork to fabrics to wall coverings;
- energy-efficient plumbing; and
- a hotelwide recycling program.
LEED-related work throughout the hotel industry has been taken to a new level.
“It’s an important differentiation,” Hill said. “… I don’t think it’s a trend; it’s an evolution. The places don’t feel like LEED hotels because things are seamless and second nature now. The sustainable trend is here to stay.”
The days of premium pricing for sustainable features have come to an end—pricing for sustainable projects most often are less than 5 percent of the cost for nonsustainable projects.
“There’s going to be significant first-mover advantages,” Hill said. “Ten years from now, it’s going to be legislated like ADA is legislated now. Those who jump in early will have greater ROI opportunities.”
The biggest challenge comes in not only educating clients, but contractors as well.
“It’s getting them to understand the price difference could be as little as 3 (percent) to 4 percent with a payback of two years,” Hill said.
Opportunities abroad
Gettys recently opened the City of Dreams project in Macau and has projects in progress in Abu Dhabi, the Philippines and China, among others.
“We’re in good position,” Hill said. “Ninety-five percent of our business is hotels. Sure, there are starts and stops along the way, including the tough economy we’re experiencing now. There’s going to some incredible wealth created in the next cycle. And there’s some incredible wealth destruction going on right now.”
Africa and India present many opportunities for hotel designers, Hill said.
For Gettys, the plan is to continue offering value engineering in an avant-garde environment. The company’s “How do you spend (US)$1 and make it look like (US)$2” mantra will remain the same.
“So much of it is understanding the objective of the project,” Hill said. “To balance those objectives with lifestyle costing is a true balancing act.”
